You are Valentina Arboleda Quintero, finance manager of Agroindustrias Guabinal, which grows sugarcane and rice on the flat floor of Colombia's Valle del Cauca. El Niño has arrived earlier than expected, and on Friday 15 January 2027 you take the first quarter's plan to the board: what to harvest and how much drip irrigation to install.
The situation
IDEAM reports rainfall 45% below the historical average in the Valle, and DANE a 3.2% fall in agricultural GDP. Guabinal irrigates by gravity from a canal it shares with other farms, and Óscar Mina, the head agronomist, reckons that of every 100 litres leaving the intake only 60 reach the roots. The rest evaporates, seeps out of the ditches or is spread unevenly.
In a quarter of normal rain, the farm harvests about 1,200 tonnes, half cane and half rice. Everything sells on a single list expressed as an index: 100 equals 3,200 pesos a kilo, the reference set by the growers' association Fedegrano; in the first week of January wholesalers were paying around 118. Production costs about COP 1.8 million per tonne of cane and 1.4 million per tonne of rice, paid at sowing and harvest, sold or not. Fixed costs are COP 900 million a quarter, and cash starts the year at COP 8,000 million. Mina keeps saying that on these fields cane needs considerably more water per tonne than rice.
A supplier has quoted drip irrigation with moisture sensors for the whole farm at up to COP 600 million, installable in stages: each stage is paid in the quarter it goes in and cannot be removed to recover the money. If nothing changes, Mina expects about 940 tonnes in the first quarter and a result of about COP 455 million.
Mina wants the full system now: water that never reaches the plant is money lost down the ditch. Hernando Lasso, the board chair, does not want to spend the cash on hoses in the middle of a drought, or to see it fall below today's level. Nobody knows how long El Niño will last.